Hire purchase remains one of the most convenient ways to purchase goods in modern times. When looking for high-value assets for your home or business, hire purchase offers you the chance to acquire them without paying upfront. Businesses are also choosing offering hire purchase agreements to buyers as it is also beneficial to them. In this post, we will evaluate the economic advantages of hire purchase with KCT, for consumers as well as the credit traders.

How Hire Purchase Works

A hire purchase agreement is a purchase contract between the credit trader and the consumer. The hire purchase agreement involves a buyer acquiring goods from the trader without paying in cash. However, they are required to pay a deposit, also known as down payment. To clear the total cost, a buyer pays in installments, and there is interest charged on these installments. This brings about the different in total cost in a hire purchase deal and a cash purchase.

Economic Advantage Of Hire Purchase For Credit Traders

A credit trader that opts to sell their goods on hire purchase terms will enjoy several benefits.

One of the advantage a trader enjoys by selling items on hire purchase terms is improved sales. The basic aim of hire purchase is to make goods affordable. Allowing buyers to pay in installments encourages them to buy assets. This improves sales and thus the profits.

Another benefit of hire purchase to traders is the ability to recover goods in the case of default on payments. The hire purchase contract allows for the seller to repossess the goods in the case of defaulting from the buyer. The repossessed goods can be resold and ensure that you do not incur loss.


Economic Advantages Of Hire Purchase With KCT To Consumers

Consumers are the biggest beneficiaries of a hire purchase agreement. Here are some of these advantages that a consumer is set to enjoy.

One of the biggest benefits of a hire purchase deal is the access to high-quality assets. With cash purchases, you can be limited on quality as most quality items come at a higher cost. With hire purchase, one acquires items that wouldn’t be affordable in a cash purchase and pay for them in installments.

Hire purchase offers a chance to spread the cost for the consumers. The repayments are fixed, thus allowing you to plan and budget appropriately.

Kenya Credit Traders offers the best hire purchase deals in Kenya.